A joint venture between Fortress Investment Group and Nomura Real Estate Holdings will purchase approximately ¥700 billion (USD $9 billion) in commercial real estate properties in Japan, according to Bloomberg.
The sales will occur over the next three years, with all of these properties being sold to rid various companies of debts. Two of the most significant owners of these properties are Morgan Stanley Real Estate and K.K. DaVinci Holdings, the news source explained. These properties were purchased before the economic downturn, and the loans have defaulted. Overall, commercial real estate properties in Tokyo have depreciated significantly since the pre-recession highs.
"The current market has a lack of office building supply," Hirokazu Anai, an analyst at JPMorgan Chase & Co. in Tokyo, told the news source. "Sales of CMBS-related assets will be a positive for the market that has enough capital to buy these assets."
Fortress has a total of $46.4 billion in assets, and funded $650 million of the project at the end of March, the news source reported, citing a company report. In addition, Nomura Real Estate Management is in the process of expanding its commercial real estate investment trust significantly.